CG64391 - Private residence relief: garden and grounds: caravans and boats
You may conclude that a caravan or a boat can be regarded as a dwelling-house and so may qualify for relief under s222(1)(a) TCGA92 (see CG64325). Where this is the case, land which can be regarded as the garden or grounds of the caravan or boat can also qualify for relief under s222(1)(b) TCGA92. This view was confirmed in Moore v Thompson (61TC15) in which the Judge stated,
“Perhaps somewhat generously the Revenue have taken the view that if the caravan was a dwelling-house, and it was at any time during the taxpayer’s period of ownership her only or main residence, then the land of the farm was in her occupation and enjoyment with that residence as its garden and grounds up to the permitted area.”
A similar line was also taken in the earlier case of Makins v Elson (51TC437) and this remains the line that you should take.
You will often find that the reason for suggesting that a caravan or boat is a dwelling-house is in order to obtain relief on the land on which it stands or is surrounded. This is because the land is often far more valuable that the caravan or boat itself. However, if the other conditions for relief are fulfilled and there is land which is identifiably used as the garden and grounds of the caravan or boat, you should allow relief on the disposal of that land.